Despite the fact that the uncertainty generated by the pandemic has allowed the savings rates of Spanish families to increase for several quarters, Spain continues to maintain one of the lowest savings rates in the European Union. Saving is still the pending issue.

Different factors that explain the lack of savings are mixed. On the one hand, it is a country with very low salaries if we compare them with other developed countries and, on the other hand, the price of housing is high. In addition, basic resources such as electricity and gas are also expensive, along with a high level of taxation. To this is added that the level of financial education is much lower than in other European countries and therefore, having less knowledge, decisions tend to be less appropriate and a higher price is paid for financing.

Below the OECD average

PISA began to assess financial competence in the 2012 edition and in the three editions that the study has been carried out, Spain continues to be below the average for OECD countries. In the last edition of 2018, countries such as Estonia, Poland, Latvia, Lithuania or Russia achieve better results in this competition. The 2018 OECD report once again points out the need to improve levels of financial education, affecting both the young and the adult population.

Currently, both the Bank of Spain and various financial institutions have created financial content on the internet. However, to develop financial training it is necessary to go further. An awareness is required to change attitudes and behaviors and thus make optimal financial decisions for each one. And for this it is important to develop these skills both in the family nucleus and in the educational system of primary, secondary and even university level.

Financial education and entrepreneurship

Crises always lead to massive job destruction. It was seen with the crisis of 2008 and again with this pandemic. Maintaining and restoring high employment levels has become an impossible goal for many governments.

Beyond policies that help to promote the creation of companies, it is important to cultivate in the educational system a culture of entrepreneurship, where failure is seen as learning and finances provide security and solidity to an idea or project. The European Commission points out that one of the first challenges that entrepreneurs face is the complexity and difficulty of finance and access to financial markets.

Therefore, policies are needed to help educate more and better society in general, and especially women, on all issues surrounding finance and risk, in order to have more prepared people to start new activities. businesses and also so that the gender difference in the field of entrepreneurship is less.

Financial culture: shared responsibility

The financial literacy of society is a shared responsibility of families and also of governments. Policies are therefore needed that bring this knowledge closer to society and that it is done at a very early age. In addition, this process should be carried out both in the family nucleus and in the schools.

Parents play a primary role since children tend to repeat behavior patterns of their referents. However, it is often the parents themselves who lack sufficient knowledge to properly educate their children in economic and financial matters. For this reason, the involvement of educational systems is also necessary, since educating financially ends up being a shared responsibility in a country.

It is necessary that the little ones learn the value of money early, cultivate financial patience and develop the habit of saving in order to evolve towards a financially intelligent society, in order to achieve social well-being.

Millennials and spending

At the same time, it should be noted that millennial youth belong to the society of digitization and immediacy. This has its good side, but also its negative consequences: using money and spending becomes quick and easy without much awareness of its consequences. That is why it is necessary to educate them financially, so that they learn to manage their personal finances properly, know how to make optimal financial decisions and have adequate economic behaviors.

Thus, advancing in the financial education of society in a shared way is increasingly necessary and essential, since a paradigm shift is approaching in the current economic and financial system that will involve from the disappearance of coins and physical bills to changes in the technological system of transactions, through the appearance of new currencies as a means of payment.

Author Bio: Elisabet Ruiz Dotras is Professor of Finance at UOC – Open University of Catalonia